It sometime gets frustrating when I get a factory that fails to produce, and it is not intuitively obvious why it didn't. Perhaps if we had a mouse over message or a right click on the red X which tells the player why the production failed?

Generally production will fail because what is needed for it is not present:

LI will fail if there are not enough resources HI will fail if there are not enough resources AND/OR if there is not enough fuel Aircraft engines, aircraft, ships, armaments, etc will fail if there are not enough HI points (or, for aircraft, not enough engines of the right sort).

I thought with the Industry Management screen the lack of resources is shown in RED when a factory fails to produce.

I thought so too.

If it was an aircraft factory that failed to produce, check the engines. This is actually not all that uncommon, especially when you're just getting your industry into some sort of order at the start of the game or after a major change in production (new engine coming online or something).

I thought with the Industry Management screen the lack of resources is shown in RED when a factory fails to produce.

I am not seeing that.

I have seen this, too - a failure with no red X. I think it may be due to the sequence of events. HI fails due to lack of fuel, but thne a refinery makes fuel at the same base, so the industry management screen shows enough fuel, but there wasn't enough when the HI check was made. I'm not absolutely sure of this because I don't know the sequence that the program checks these things, but it's my "guess".